Hedge fund billionaire Bill Ackman, the CEO of $US12 billion Pershing Square Capital Management, is funding a scholarship program aimed at helping social entrepreneurs receive an MBA from the University of Oxford.
The Pershing Square Foundation, a charitable organisation Ackman co-founded with his wife Karen, announced the launch of the Oxford Pershing Square Graduate Scholars Program last night with a gift of $US6.6 million to endow the scholarships.
The purpose of the scholarship program is to bring on young leaders and innovators who want to “address world-scale challenges for the benefit of society.”
Social entrepreneurs are people who want to find solutions for social problems. For example, one of the students is helping shrimp farmers in Southeast Asia use low cost instrumentation to measure water salinity. These aren’t MBA students who want to work for hedge funds or investment banks.
Each year, five students will receive full rides for Oxford’s 1+1 program, which allows students to do the one-year Oxford MBA paired with one of many of the university’s other master’s programs.
The scholarship program is open to students globally. The first group of scholars will start in the fall of 2014.
What makes this program such an obvious choice is that it gives students “depth and breadth,” Oxford’s Saïd Business School Dean Peter Tufano explained to Business Insider.
“It takes both domain expertise and management skills to solve problems. Simply having a broad set of skills without knowing the facts about the problem it’s really hard to, for example, address issues of water policy, address environmental issues, fix education. All of these things require that you know something about the underlying phenomenon. So what we’ve created with our 1+1 program is an ability to first get depth and then get breadth of management skills,” Tufano said.
Tufano was Ackman’s finance professor at Harvard Business School, so we had to ask him what he was like as a student.
“I think he’s like the person that you see now — very smart, determined, asked lots of questions,” he said. He couldn’t remember where Ackman sat in the classroom, but that didn’t matter. You knew he was there.
We caught up with Ackman at a reception at the Park Avenue Armory last night in Manhattan’s Upper East Side to celebrate the new partnership between the Saïd Business School and The Pershing Square Foundation.
He recalled his school days for us.
“I remember it well. I can say I learned a lot. So pay it back.”
The activist/long term value investor, who usually focuses on early and high school education, told us why he’s so excited about this scholarship.
“Higher education has plenty of support. I’m more concerned with early education, frankly, and high school education. This is sort of a unique thing this is supporting people who want to be social entrepreneurs and giving them the opportunity to get a business school education and that’s why I think it’s important,” Ackman told us in an interview.
Despite increasing costs with higher education, Ackman, who graduated from Harvard and Harvard Business School, still believes it’s a viable investment for most Americans.
“Yes, but I would say the the following: The problem with a business school degree is that it’s very expensive and you have to take, in order to pay back your loans, a very high paying job, which pushes people to Wall Street and consulting and those kind of jobs, not that there’s anything wrong with that. But the talented entrepreneur that wants to save the world it’s hard, save-the-world jobs tend not to pay well. So if you’re burdened with student loans absent from having the resources from your family it’s hard for you to pursue a non-for-profit initiative.”
During his address to the crowd, he explained just how fortunate he was having his parents help pay for his higher level education.
“I was one of the people fortunate enough who had parents pay for my business school education. I went into business. Had I been interested in pursuing something social focused on finding water…for people without water in Africa or if I wanted to change the health care system, it would be hard to pay back my student loans with the entry level opportunities.”
Also present at the reception last night was Dr. Paul Farmer, the co-founder of Partners in Health, private equity billionaire Stephen Schwarzman, Paul Bernstein, the CEO of the Pershing Square Foundation and Ackman’s family, including his wife, Karen, teenage daughter, sister and parents, Larry and Ronnie.